John K. Welch
HUNTINGTON INGALLS INDUSTRIESAbout John K. Welch
John K. Welch, age 75, has served as an independent director of Huntington Ingalls Industries (HII) since February 2015. He is the former President and CEO of Centrus Energy Corp. (formerly USEC Inc.) from October 2005 to October 2014, previously an Executive Vice President at General Dynamics’ Marine Systems Group, and earlier held multiple leadership roles at Electric Boat; he also served over seven years on active duty as a U.S. Navy nuclear submarine officer. At HII, Welch chairs the Governance and Policy Committee and is a member of the Audit Committee, reflecting board-level oversight of governance, risk, and financial controls .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Centrus Energy Corp. (USEC Inc.) | President & CEO | Oct 2005 – Oct 2014 | Led public company in energy sector; prior HII competitor exposure brings industry perspective |
| General Dynamics Corporation (Marine Systems Group: Bath Iron Works, Electric Boat, NASSCO) | Executive Vice President | Retired 2003 | Oversaw shipbuilding operations and strategy across major naval shipyards |
| Electric Boat (General Dynamics) | President; VP Programs; VP Program Development | 1989 – 2003 | Led new construction/overhaul/repair programs, strategic planning, material acquisition, IT |
| U.S. Navy | Nuclear Submarine Officer (active duty) | 7+ years | Technical nuclear expertise; later retired from Naval Reserve |
External Roles
| Organization | Role | Tenure/Status | Notes |
|---|---|---|---|
| Novawall Systems Incorporated | Director | Current | Private company board |
| Ocean Reef Community Association | Chairman of the Board | Current | Community association governance |
| Battelle Memorial Institute | Chairman of the Board | Retired | Major nonprofit R&D institution with defense ties |
| Centrus Energy Corp./USEC Inc. | Director | 2005 – 2013 | Prior public company directorship |
Board Governance
- Committee assignments: Chair, Governance and Policy Committee; Member, Audit Committee .
- Independence: All standing committees (including Governance & Policy and Audit) are comprised of independent directors under HII guidelines and SEC/NYSE standards .
- Attendance and engagement: In 2024, the Board met six times; each director attended 75%+ of Board and applicable committee meetings. Independent directors held executive sessions at all five regular Board meetings; all directors attended the 2024 Annual Meeting .
- Board leadership: Non-executive Chairman (Adm. Kirkland H. Donald) chairs executive sessions and sets agendas with committee chairs, reinforcing independent oversight .
- Governance remit of Welch’s committee: The Governance & Policy Committee oversees director nominations, governance documents and policies, sustainability oversight (non-human capital), related-person transactions screening, and Board evaluation and risk oversight process allocation .
Fixed Compensation
| Component | 2024 Amount | Detail |
|---|---|---|
| Annual cash retainer | $120,000 | Paid quarterly in arrears |
| Committee chair retainer (Governance & Policy) | $20,000 | Welch is GP Chair |
| Audit committee member retainer | $17,500 | Welch is an Audit member |
| Total fees earned (Welch) | $157,500 | Sum of base + chair + committee member |
| Annual equity grant (standard) | $165,000 | Issued as DSUs or shares; quarterly ($41,250 per quarter) |
| Stock awards (Welch) | $164,459 | Aggregate grant-date fair value, Topic 718 |
| Total 2024 director comp (Welch) | $321,959 | Cash + equity |
HII discloses no per-meeting fees; director pay approximates median of HII’s peer group and the S&P 500 per consultant review .
Performance Compensation
| Equity Award Mechanics | Disclosure |
|---|---|
| Instrument | Deferred stock units (DSUs) or common shares, director election |
| Grant timing | Quarterly on first trading day of each quarter |
| Quantum | $165,000 per year (approx. $41,250 per quarter) |
| Dividend equivalents | Credited on outstanding DSUs; subject to same vesting/payment provisions |
| Deferral options | If a director owns ≥5x annual cash retainer in HII stock, may elect DSUs payable 5 years after earn year or upon departure; otherwise DSUs payable upon termination of board service |
| Plan terms | Awards under HII’s 2022 LTIP; prohibition on hedging, pledging, margin accounts for directors |
No performance-conditioned metrics (e.g., TSR/EBITDA) are disclosed for non-employee director equity grants; awards are fixed-dollar DSUs or shares aligned to long-term ownership .
Other Directorships & Interlocks
| Type | Company | Role | Notes |
|---|---|---|---|
| Current public company boards | — | — | None disclosed for Welch in HII proxy |
| Prior public company boards | Centrus Energy/USEC | Director | 2005–2013 |
| Private/nonprofit boards | Novawall Systems; Ocean Reef Community Association; Battelle Memorial Institute | Director/Chairman | Governance roles outside HII |
Historical executive ties to General Dynamics (Electric Boat) represent industry competitor experience but no current interlock or related-party transaction disclosed for Welch .
Expertise & Qualifications
- Chief executive leadership (public company CEO) and corporate governance expertise .
- CFO/accounting and investment strategy/corporate development/M&A exposure .
- Shipbuilding operations leadership; nuclear program and naval domain familiarity .
Equity Ownership
| Measure | Value | As-of Date |
|---|---|---|
| Shares of common stock beneficially owned (Welch) | 2,545 | Feb 28, 2025 |
| Share equivalents (non-voting DSUs) (Welch) | 6,823 | Feb 28, 2025 |
| Total (shares + equivalents) (Welch) | 9,368 | Feb 28, 2025 |
| Deferred stock units held (Welch) | 6,604 | Dec 31, 2024 |
| Ownership threshold for enhanced deferral elections | ≥5x annual cash retainer in HII stock | |
| Hedging/pledging status | Prohibited for directors under Insider Trading Policy |
HII notes that no director or officer beneficially owns ≥1% of outstanding shares; group total ownership data disclosed for context .
Governance Assessment
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Strengths
- Governance leadership: Chairs the Governance & Policy Committee overseeing nominations, related-person transactions, and Board evaluations—key to board effectiveness and conflict controls .
- Financial oversight: Audit Committee member; committee confirms auditor independence and financial reporting integrity via formal process/report .
- Engagement: Met attendance expectations (≥75% at Board/committees); all directors attended the 2024 Annual Meeting; independent directors held executive sessions at every regular Board meeting—signal of active oversight .
- Alignment: Receives equity via DSUs; robust ownership guidelines and anti-hedging/pledging policy support long-term alignment .
- Investor confidence backdrop: Strong say-on-pay support (96% in 2024; 97% prior years) reflects broader governance credibility at HII .
-
Potential Risks/Red Flags
- Imminent retirement triggers: HII’s retirement policy requires directors to retire at the annual meeting following the earlier of age 76 or 15 years of service; Welch is 75 and at ~10 years of service, indicating near-term board turnover risk and succession considerations .
- Ownership depth: Direct share ownership (2,545) is modest; while DSUs enhance alignment, the low outright share position may be scrutinized by investors focused on “skin in the game” .
- Historic competitor ties: Prior senior roles at General Dynamics/Electric Boat may raise perceived bias concerns; however, no current related-party transactions involving Welch are disclosed, and his committee chairs the related-person transaction policy oversight .
Related-Person Transactions: HII disclosed only plan-trust service relationships with State Street and BlackRock and one family employment relationship (CEO’s daughter); no Welch-related transactions were reported .
Committee Independence: All standing committees comprise independent directors; this includes Welch’s memberships and chair role .